The End of Record Labels: Radiohead Clears An Estimated $8 Million in First Week

A recent poll shows that fans paid an average of $8 for the new Radiohead album "In Rainbows" meaning that Thom and the boys may have cleared over $8 Million in the first week of the album's digital release.

As reported on DigitalJournal.com, rock group radiohead chose to release their album online "In Rainbows" in digital format for whatever price their fans were willing to pay for it.

Some saw this move as being a financial risk for the band as the website actually allowed users to purchase the record for $0.00 if they chose to download it for free. I actually took this route and got the album for $0.00 no fees, no cost whatsoever, nada.

Machinist.salon.com reports that as it turns out the new concept in releasing an album appears to be highly profitable for the band who will surely be revered as marketing / musical geniuses from this point on.

Gigwise reported that Radiohead has sold 1.2 million digital copies of the album, "In Rainbows," since the site launch on Tuesday of last week but until now there have been no statistics released on how much fans paid for the album which would in turn show how much money Radiohead has made so far from sales.

A British music newsletter called "Record of the Day" did a poll of 3000 people that purchased the album and found that an average of about $8 was paid. This would mean that it's possible that Radiohead has pulled in around $8.5 Million in one week from mp3 sales.

Keep in mind that Radiohead is also not working with a record label so they get to keep all of this money. For a band on a label, making this kind of money would require selling a massive amount of albums, in the 10s of millions... which is next to impossible even for well established world famous groups.

It was also estimated that if the band had chosen to release their album on iTunes only, without a record label, they would have only cleared about $1.50 per album, a fraction of the $8 per album estimation from the British poll.

News like this is surely going to shake the music industry to it's core and artists are going to start jumping ship very soon. It has already been reported that Madonna is ending her relationship with her label of 18 years and Tech Crunch reports that Nine Inch Nails have also now become a free agent and will release their own albums from now on.